Institutional Responses to Uncertainty: Evidence from the Transfer Market

In this paper we examine the organisation of the transfer ma*et for associationfootball players in the English Football League adopting a transqc-tiotts cost frameworlc The transfer system for professional footballers is ellectiyely the game's labour market and we argue that it is charac-terised by small mnnbers bargaining and uncer-tainty and that therefore the transactions cosl pu'adigm is releyant We analyse 7,367 league lransfers between English Football League clubs covering the seasons 1977-8 through l99j-4. Our results suggest that the ftansler market hqs evolved in distinctive u)ars in rcsponse to infor-mational problems. In particular we identify long-term rclationships between clubs, wel